An Overview of Iranian Cooperatives

EghtesadOnline: Iran is home to 217,138 registered cooperatives as of Aug. 6, of which 93,306 or 43% are active, according to a report by the Ministry of Cooperatives, Labor and Social Welfare's Statistics and Strategic Data Center.

News ID: ۷۴۸۳۵۰

03 September 2019

A cooperative is a jointly owned enterprise engaging in the production or distribution of goods or the supply of services, operated by its members for their mutual benefit, typically organized by consumers or farmers. Cooperative businesses are usually more economically resilient than many other forms of enterprise, with twice the number of cooperatives surviving their first five years compared with other business models.

These entities frequently have social goals that members aim to accomplish by investing a portion of trading profits back into their communities.

Cooperatives active in “agriculture, hunting and forestry” and “industry” sectors have the largest shares constituting 25.5% and 22.5%, respectively, Financial Tribune reported.

The average number of members and jobs created by each cooperative stands at 618 and 19, and the average investment made in each cooperative hovers around 1,719 million rials ($15,000).

Women have registered 23,357 cooperatives, of which 10,228 (43.8%) are active. Of cooperatives established by women, 44.5% are in “industry” and 20% in “agriculture, hunting and forestry”.

The average number of members and jobs created by women’s cooperatives stands at 12 people and the average investment made in women’s cooperatives is 445 million rials ($3,886).

Out of 170,750 managing directors of registered cooperatives, 155,086 or 90.8% are men and 15,664 or 9.2% are women.

A total of 217 knowledge-based cooperatives have been registered in Iran as of August 6, of which 203 are active.

Investment made in and employment created by knowledge-based cooperatives stand at 169,701 million rials ($1.48 million) and 2,585 jobs. About 41% of knowledge-based cooperatives are active in “industry”, followed by “real estate” with 27.1% and “agriculture, hunting and forestry" with 14.8%.

The average number of members and employees in the country’s active knowledge-based cooperatives is 13, while the average investment made in such cooperatives is 836 million rials ($7,300).

According to President of Iran Chamber of Cooperatives Bahman Abdollahi, Tehran Province hosts the highest number of cooperatives among all Iranian provinces with 11% or 10,700 cooperative enterprises.

The latest report released by the Statistics and Strategic Data Center shows 229 new cooperatives were registered during the fourth month of the current Iranian year (June 22-July 22), which shows a 30% decline compared with the corresponding period of last year.

Set up by 3,480 members, these cooperatives are estimated to have created 4,275 jobs, indicating a 19% fall and 4% increase respectively year-on-year.

The highest number of cooperatives was registered in the provinces of Fars and Khorasan Razavi with 28 and 20 companies respectively.

Moreover, the highest number of cooperatives was registered in the fields of agriculture (68) and industries (55). The two fields also had the largest number of members among others with 962 and 783 respectively. Combined, they are estimated to create the largest number of jobs with 1,339 and 629 respectively.

Abdollahi noted that the current share of Iran's cooperative sector from GDP is around 7%.

The Iranian Parliament has tasked the government with increasing the share of cooperatives in gross domestic product to 25% by the end of the Sixth Five-Year Development Plan (2021).